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Classic "Bread and Butter" long:
- Gap up and decline to the retracement zone
- Hammer forms on top of the retracement zone
- Target was the Fibonacci extension - I closed the position just short of that when the 7th and 8th bars were weak and formed "hanging-man" type candles.
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Tags:
Trader-X, Stocks, Fibonacci, Trading, LLL
5 comments:
nice trade Tom! i tried hitting MCD but ended up -.03. i also noted that HNT acted well and CHRW until late in the day
I couldn't get a decent entry in LLL. The moment the 3rd bar was about to break the high of the 2nd bar (would have been my entry), the ask jumped about 20 cents, so I passed on the entry....
Must have been a lot of folks on here getting into LLL it was so obvious...LOL
Seriously though, I know market orders are usually best with listed stocks, but in this case, slippage would have been a little bit much....
Whatcha think?
Take a look at MATK (15 min) today:
First candle was a WR with an upper tail. The second candle was almost an inside, NR that took price to the high of the OR. The third candle would have been the entry, as price traded above the OR. But it failed. Any thoughts?
posted by Tom C:
Hey Babak...I actually had MATK on my watchlist, but the 30-minute. I passed because the 2nd bar was too wide-range and indecisive (doji).
Looking at the 15-minute chart, I see what you saw. I like those entries on where the second bar kind of "nestles" in the first. I would have given it more consideration than the 30-minute, but I don't know if I would or would not have traded it had I saw it.
In the end always remember X's warning about entering below the OR high. It is resistance, and sometimes price fails at that area. It seems that is what happened here...
LLL is a good example of a b&b that forms at the right area - as opposed to one that retraces deeper into the retracement zone. Good trade.
I have noticed that you can let short set-ups on the b&b retrace a little further, and they still work. What are your thoughts?
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